LONDON, Oct 10: Stock markets took another beating in Asia and see-sawed nervously in Europe as the gloomy mood infecting equity investors around the globe showed little sign of abating.
Share prices in Tokyo slumped 1.2 percent to mark their third 19-year low for the week while Seoul plummeted 5.8 percent to its lowest level this year, ending below the 600 points barrier.
The Nikkei-225 index of the Tokyo Stock Exchange fell 99.72 points to 8,439.62 on continued fears over the fallout from the government’s aggressive stance on resolving bad loans, dealers said.
We cannot see the bottom. I cannot see the current downtrend coming to a halt as markets abroad are also tumbling (and) Japan has its own problems, said Toshihiko Matsuno, broker at Sakura Friend Securities in Tokyo.
Foreign investors are not buying as they are on fire at home. Europe-based players are major sellers, in particular, he said.
European share markets gave up early gains to head mostly lower, mirroring fresh selling pressure in the United States and Asia by investors harbouring concern about the weakness of corporate earnings.
Across the 12-nation euro zone, the Euro Stoxx 50 index of leading European shares slipped 0.3 percent to 2,143.6 points.
There was little reason for cheer from the monthly interest rate decisions of the European Central Bank and the Bank of England, which both announced they had decided to leave their main lending rates unchanged at 3.25pc and 4.0pc respectively.
And the EU commission, citing weakening consumer spending and soft export demand, lowered its third- and fourth-quarter euro-zone growth forecasts to between 0.2 and 0.5 per cent, a 0.1-point decline from the range projected in early September.
Among leading European markets, the British FTSE 100 index lost 1.9 per cent to 3,671.6 points, the French CAC 40 index eased 0.1 per cent to 2,652.6 points, while the German DAX 30 index gained 0.4pc to 2,608.8 points.
Robert Kerr, European equities strategist at Banc of America Securities, said investors were homing in on over-valued stocks in Europe.
Defensive stocks producing generally good news that have kept on going getting upgrades, they’re now sticking out like sore thumbs so the market’s giving them a a bit of a spanking, he said.
They clearly won’t come down as far as companies which are producing generally bad news, but it tells you the mood of the market: the market needs to sell things and it’s running out of things to sell, he added.
In New York, US stocks plumbed a new nadir on Wedneday amid jitters over impending third-quarter results from blue chip companies.
The Dow Jones Industrial Average slid to its lowest close in five years, down 215.50 points or 2.88 per cent at 7,285.37.
The tech-heavy Nasdaq index also fell, closing down 17.02 points at 1,112.19.
The effect of Wall Street’s slump was felt also in the rest of Asia, with Seoul’s composite index losing 35.90 points to 584.04, while the Hang Seng index in Hong Kong ended the morning session down 149.47 points at 8,827.88.
In Australia, the key SP/ASX 200 index closed down 16.1 points at 2,896.6. —AFP